Let Suppliers Sit At the B2B Table

When things go wrong in the integrated supply chain, the easiest dodge in the world is to blame suppliers. Suppliers often have a rough time of it in B2B; they tend to lie at the outskirts of integrated processes, not treated as full partners.

This attitude is out of date, according to Principles and Practices of Public Procurement, a consortium for public sector supply chain best practices. Equitable treatment of suppliers as B2B partners should be a guiding principle.

What should that equitable treatment include? Openness and mutual visibility should be agreed-upon standards in the supplier relationship. This lowers the risk of delays, enhances contingency planning, and reduces recovery time when delivery failures do occur.

Another important practice is governance. A team-based approach to management of the vendor relationship can be an advantage. Defining the day-to-day roles and responsibilities of those who interact with the supplier leads to repeatability of successful process innovations, and efficient escalation for problem resolution.

On the technical side, single-sourcing of data is a recommended step, enabling consistent processing and minimizing the chances of data loss for all parties.

Going the extra mile can also pay off. Apple secured its position with critical suppliers by investing more than $3 billion in pre-payments to those suppliers, ensuring their long-term loyalty, reducing risk and strengthening those partners within their own markets. That level of investment is rare, but the principle behind it – treat suppliers as full B2B partners – is a sound one.

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Strategic Managed File Transfer

Managed File Transfer is an important new tool in B2B integration, enhancing a traditional data-sharing mechanism with audit, enhanced security, and failed delivery functionality. But the benefits of MFT extend beyond the technical, also enhancing business processes.

As B2B partner networks grow increasingly integrated, so do B2B partner business processes; the need for increased partner collaboration and the accompanying need for increased visibility make MTF as much a strategic business imperative as a technical goal.

Industry analyst Derek Brink has summarized the strategic features of managed file transfers, as they affect business process integration:

•Visibility. In the film The Godfather, the point is made, “Mr. Corleone is a man who insists on hearing bad news immediately,” Brinks writes. His point is that it is better to keep all parties in a B2B-integrated supply chain as up-to-the-minute as possible, in matters of delivery, inventory maintenance, information access, transaction verification, and other messages. MFT provides workflow to ensure this visibility, he points out.

•Reliability is essential to achieving this visibility, Brinks continues: assurance of file delivery, with confirmation, delivery failure options, and checkpointed process recovery, provide that reliability.

•Integration with existing infrastructure, easily achieved with MFT, encourages smooth business uptake of MFT enhancements, he concludes: to be able to integrate up-to-the-minute messaging and immediately monitor acceptance and response enhances partner confidence.

Finally, he points out that standardizing messaging around a robust and reliable platform leads to centralized messaging policies and administration on the business side.

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Are You Monitoring Supply Chain Velocity?

Supply chain velocity is about more than just speed. As in physics, velocity in the supply chain is as much about direction as speed. And direction is often a question of rapidly (and, more importantly, effectively) responding to change.

“Pressures often come from dynamic changes in customer demands as they try to capitalize on getting products to market,” Adrian Wood of Pegasus Logistics Group told Inbound Logistics. “These can include last-minute changes in delivery requirements and the rush to meet industry cut-off times, or having to rapidly investigate alternate shipping methods to address cargo capacity constraints.”

Improving velocity often enfolds several end goals that enhance performance and customer satisfaction across the board: strong alignment between operational planning and business objectives; increased visibility; and increased reliability. Though each of these is measured in different ways, improvement in all may be achieved through careful monitoring of supply chain velocity.

That in itself is no easy task. Accurate measure of supply chain velocity is not simply a metric associated with time of delivery; it incorporates a number of factors, including synchronization of suppliers and service providers, reliable connectivity, effective analytics and tested disruption plans, cross-partner inventory integration and real-time transaction reconciliation between partners.

This kind of detail requires not only robust monitoring of a number of processes and events, but strong planning and liberal sharing of data between partners. The end result is delivery that is not only fast but reliable, focused, and in line with the strategic imperatives of the enterprise.

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Is Crowdsourcing the Next Big Component of Supply Chain Logistics?

News of crowdsourcing initiatives in supply chain logistics is increasingly frequent, and with good reason: crowdsourcing expands a supply chain’s ability to deliver on or ahead of time, increases redundancy, and enhances customer satisfaction.

In a recent discussion of high-profile crowdsourcing innovations, details of the successes of Amazon and rival Google are articulated: guaranteed two-day delivery, leveraging a wide scattering of distribution centers and an independent delivery fleet for Amazon, the tapping of local businesses for same-day service for Google.

Why is this important? Because Amazon leads the world in supply chain successes that have altered consumer consciousness. Expectations of supply chain delivery, efficiency and accuracy have been almost universally transformed by Amazon’s successful model. The answer, for smaller enterprises wishing to meet such a high standard? Crowdsourcing – signing up just about any potential logistics partner on wheels, up to and including taxi companies.

Uber-X is a good example: the San Francisco-based transportation networking pioneer has brought the concept of the taxi into the twenty-first century, coordinating vehicles for hire in the US and other countries by means of a convenient smart phone app. That network (and others, including Lyft) are available as a potential crowdsourced delivery fleet for any supply chain with the desire to leverage it. And with Uber’s stated goal of deploying driverless vehicles as soon as the technology is proven, such a network would one day be competitive with Amazon’s drone delivery program.

Certification, insurance, and maintenance checks become a concern, but they would be, anyway. The importance of the trend is that very high standards of performance in product delivery are rapidly becoming universal – making those standards a priority for any supply chain, with crowdsourcing an increasingly worthy option for consideration.

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